Question

Novak Corp. sells a snowboard, EZslide, that is popular with snowboard enthusiasts. Below is information relating to Novak Corp.’s purchases of EZslide snowboards during September. During the same month, 107 EZslide snowboards were sold. Novak Corp. uses a periodic inventory system. Date Explanation Units Unit Cost Total Cost Sept. 1 Inventory 13 $117 $ 1,521 Sept. 12 Purchases 46 120 5,520 Sept. 19 Purchases 60 121 7,260 Sept. 26 Purchases 21 122 2,562 Totals 140 $16,863 (a) Compute the ending inventory at September 30 using the FIFO, LIFO and average-cost methods. (Round average cost per unit to 3 decimal places, e.g. 125.153 and final answers to 0 decimal places, e.g. 125.) FIFO LIFO AVERAGE-COST The ending inventory at September 30 $Enter a dollar amount $Enter a dollar amount $Enter a dollar amount (b) Compute the cost of goods sold at September 30 using the FIFO, LIFO and average-cost methods. (Round average cost per unit to 3 decimal places, e.g. 125.153 and final answers to 0 decimal places, e.g. 125.) FIFO LIFO AVERAGE-COST Cost of goods sold $Enter a dollar amount $Enter a dollar amount $Enter a dollar amount

Answer 1

Answer:

FIFO Ending Inventory= $ 2562+$ 1452= $ 4014

LIFO Ending Inventory= $ 1521+$ 2400= $ 3921

Average Cost  Ending Inventory= $ 3974.85

FIFO -COST Cost of goods $ 12849

LIFO -COST Cost of goods=$ 12942

AVERAGE-COST Cost of goods= $ 12,888.15

Explanation:

Date           Explanation         Units       Unit Cost            Total Cost

Sept. 1           Inventory             13            $117                   $ 1,521

Sept. 12          Purchases         46           120                      5,520

Sept. 19          Purchases        60           121                        7,260

Sept. 26           Purchases      21           122                        2,562

Totals                                        140                                    $16,863

Ending Inventory = 140- 107= 33

FIFO Ending Inventory =   21 units at  $122  + 12 Units at 121  

FIFO Ending Inventory= $ 2562+$ 1452= $ 4014

LIFO Ending Inventory =   13 units at  $117  + 20 Units at 120    

LIFO Ending Inventory= $ 1521+$ 2400= $ 3921

Average Cost  Ending Inventory= ($ 16863/ 140 )* 33

Average Cost  Ending Inventory= $ 3974.85

FIFO -COST Cost of goods= Purchases - FIFO Ending Inventory

                                           =  $16,863 -$ 4014  = $ 12849

LIFO -COST Cost of goods= Purchases - LIFO Ending Inventory

                                              =  $16,863 -$ 3921 = $ 12942

AVERAGE-COST Cost of goods= Purchases - Average Cost Ending Inventory

                                                      =  $16,863-$ 3974.85= $ 12,888.15